Peace necessary before economic relations with Israel

Israel has criticised international companies operating in this region because they do not provide services to Israeli establishments or even cooperate with them.

The criticism comes at a time when GCC states have become a leading financial hub in the Middle East and North Africa.

Private companies here enjoy a lot of benefits when it comes to taxes and transfer of profits. They also get sophisticated infrastructure, facilities and world-class services.

These companies have their own agendas. And Israeli officials, who call for normalisation of ties with regional states, themselves are to blame for many problems.

For instance, it would have been possible to implement a proposal submitted by former Israeli prime minister Shimon Peres in the 1990s to set up a Middle East common market if Israel honoured the Oslo Accord and the promises of the Madrid Conference in 1991.

This would also have been possible if the suggestions of former US president Bill Clinton were taken into consideration and put into action.

This raises a question: What hinders the establishment of normal economic ties in the region?

Arab countries have been trying to achieve a comprehensive and just peace on the principle of Israeli and Palestinian states living side by side.

The Palestinian state should be set up on the Palestinian territories with Jerusalem as its capital.

The visit by former Egyptian president Anwar Sadat to occupied Jerusalem in 1977 is evidence of efforts aimed at arriving at a just settlement and establishment of economic ties with Israel

Nevertheless, Israel has expanded its colonies in the occupied areas and displaced thousands of Palestinians after demolishing their homes.

Even more, Tel Aviv rejected suggestions by the European Union (EU) to activate the peace process.

This raises another question: which Middle East market were Peres and Israeli officials talking about? Israel's double standards has prompted most Arab countries to lose hope about any form of economic cooperation.

Israel's problem is that it tries to go beyond geography. Israel is a small state set up in 1948 in occupied Arab lands and is surrounded by Arab countries from three sides. This clearly means the future of Israel depends on its integration within its surrounding.

For example, Israel imports oil from remote countries such as Singapore at huge transport costs, at a time when regional countries are the world's largest oil producers and exporters and possess huge oil reserve.

Negative effects

The Israeli policy has resulted in negative consequences. Its rejection of European proposals has contributed to spreading extremism in both the Arab and Israeli sides, and blocks efforts for regional economic cooperation.

The world is changing fast. It is now like a small village with flow of information and technology.

Due to these changes, economy has become top priority to most countries at the expense of ideology. But Israel has not yet realised this. International companies that were criticised by Israel for not dealing with it have their own interests in the Gulf market.

This is simply because Arab markets, especially Gulf ones, are very important for the business activities of these companies. The Arab market is huge with 300 million people. Compare this to Israel, which only has a population of six million.

Arab countries with their peaceful approach to Israel provide a historic chance to set up a region free of wars and economically prosperous Middle East where international companies can provide their services to all countries.

The author is a UAE economic expert.